Chinese contract drugmaker Pharmaron plans HK listing to raise around $500m

The flag of Hong Kong Exchanges & Clearing Ltd. (HKEx), top center, the Chinese national flag, bottom center, and the Hong Kong SAR flag, bottom right, fly in the Central district of Hong Kong, China, on Wednesday, March 2, 2016. Photographer: Justin Chin/Bloomberg

Pharmaron Beijing Co. is planning a Hong Kong share sale only six months after the contract drugmaker went public in China, according to people with knowledge of the matter.

The Shenzhen-listed company is working with financial advisers as it prepares to sell shares in Hong Kong as soon as this year, the people said, asking not to be identified because the information is private. The listing could raise around $500 million based on Pharmaron’s current market value, one of the people said.

Shares of Pharmaron climbed as much as 1.4% in early Wednesday trading in Shenzhen, giving it a market capitalization of about 23 billion yuan. The stock has more than quadrupled since the company’s January IPO, which raised 503 million yuan ($73 million). The Shenzhen Stock Exchange Composite Index rose 18.2% over the period.

Pharmaron would follow rival WuXi AppTec Co., which also completed listings in Shanghai and Hong Kong within the same year. Health-care firms have raised $2.6 billion from Hong Kong first-time share sales in 2019, almost seven times the amount from a year earlier, after the city’s stock exchange eased its listing rules to allow unprofitable biotech firms to go public.

Deliberations are at an early stage, and details of the offering could still change, the people said. An external representative for Beijing-based Pharmaron declined to comment.

Founded in 2004, Pharmaron offers research and development services to the life sciences industry, according to its website. It counts more than 6,000 employees with operations in China, the U.S. and the U.K.

Bloomberg